Economics B 1.2.4

What is a main advantage of specialisation?

• It increases the complexity of production.

• It reduces production costs and can lead to lower prices and inflation levels.

• It ensures that countries are self-sufficient.

• It increases the time spent switching between tasks.

What is a potential disadvantage of specialisation for countries?

• It can lead to an increase in living standards.

• It can cause countries to lose the benefits of diversity and lead to dramatic effects on economies specialised in that industry.

• It can reduce consumer choice from international goods.

• It can increase growth rates as production increases.

What does the division of labour eliminate according to Adam Smith's theory?

• The need for skilled workers.

• The time spent switching between tasks.

• The motivation of workers.

• The efficiency of production.

What is a potential disadvantage of the division of labour for workers?

• It can lead to workers becoming experts at a task.

• It can lead to workers being unable to do anything else once they leave the job since they are unskilled in many other areas.

• It can lead to an increase in productivity.

• It can lead to a decrease in the time spent switching between tasks.

What was one of the effects of the 2008 financial crisis on economies around the world?

• Many economies increased their levels of production.

• Many economies maintained the same levels of production.

• Many economies decreased their levels of production.

• Many economies outsourced their production to other countries.

What is the owner of Clay Creations Ltd considering due to the popularity of designs from one worker?

• Hiring more workers to increase production.

• Reducing the number of pottery items produced.

• Specializing workers in only one element of the production process.

• Expanding the business to include more pottery designs.

What role does technology play in the specialization of labor?

• It decreases the need for specialized skills.

• It increases the efficiency of production without changing labor roles.

• It enables workers to perform more specialized tasks more efficiently.

• It makes specialization unnecessary by automating all tasks.

What is a potential risk of high specialization in a single industry for a country's economy?

• It can lead to increased innovation and competitiveness in the global market.

• It can make the economy more resilient to external shocks.

• It can expose the economy to higher risk if the industry suffers a downturn.

• It can ensure steady employment rates due to the industry's stability.